The race to extract lithium in the Imperial Valley got a boost earlier this month, when the Biden administration’s Department of Energy announced it would provide more than a billion-dollar loan to one company vying to be among the first to launch its operation.
Then, one week after President Trump’s inauguration, his administration sent a memo to all federal agencies telling them to pause grants, loans and other financial assistance pending review.
The move, temporarily blocked by a federal judge on Tuesday, and then rescinded by Trump’s budget office on Wednesday, raises questions about whether the loan is still coming, and if so, when and how it will come through. Trump’s order sent a shockwave of confusion across the country as the order would have shut down programs spanning from providing school lunches to federal health care reimbursements and more.
The $1.36 billion “conditional commitment” loan, announced by the Department of Energy on January 15, would help EnergySource Minerals to build out and launch its ATLiS lithium project, which would extract the metal from geothermal brine from under the Salton Sea.
A spokesperson for EnergySource Minerals referred inewsource to the Department of Energy for questions about the loan. The agency didn’t respond. According to the press release, certain conditions must be met to finalize the loan.
The loan announcement signaled a major investment that, if delivered, would help launch commercial production of lithium. The announcement came just days after more positive news for lithium advocates when a Superior Court judge dismissed a challenge to another Lithium Valley project, clearing the way for commercial lithium development.
Lithium is a metal used for making batteries that power electric vehicles and other electronics. The U.S. currently depends on foreign suppliers for the mineral, while vast stores under the Salton Sea could help make the United States a key player worldwide.
China currently produces over half the world’s batteries, while Chile sits on the majority of the world’s untapped lithium reserves.
Since 2020, the U.S. has considered lithium a “critical mineral,” prioritizing the need for securing the metal in its supply chain.
The Jan. 27 memo, issued by the White House Office of Management and Budget following a weeklong record number of executive orders, has spawned questions as to what role the government will play in renewable energy initiatives.
The memo said that the federal government was halting funds to ensure that federal spending is “dedicated to advancing Administration priorities.”
“The use of Federal resources to advance Marxist equity, transgenderism, and green new deal social engineering policies is a waste of taxpayer dollars that does not improve the day-to-day lives of those we serve,” the memo states.
Introduced as a resolution in 2019 by Rep. Alexandria Ocasio-Cortez, D-New York, the Green New Deal set out a framework for federal policies to address climate change as well as its impacts on lower-income communities, emphasizing the need to push for renewable energy development.
The memo follows a Jan. 20 executive order to eliminate what he incorrectly calls the “electric vehicle mandate,” a non-legally binding 2021 executive order signed by Biden that set the goal for 50% of new cars sold in the U.S. to be electric.
In Southern California, public officials had no news to report on the status of the loan.
U.S. Sen. Alex Padilla, a Democrat who has pushed for funding for Lithium Valley, issued the following statement to inewsource:
“As the need for energy use continues to grow, I’ve pushed for increased investments in the Salton Sea region where we know there is significant potential for geothermal energy and domestic sourcing of critical minerals. I urge the Trump Administration to continue building on this progress to support and incentivize research and development in the region to help us usher in a new era of American energy dominance.”
Imperial County Supervisor Ryan Kelley, who has been a key local leader in Lithium Valley development and has advocated for federal funding, says he continues to stand in support of the project.
On Tuesday, California Attorney General Rob Bonta joined 23 other attorneys general, answering the memo with a lawsuit. Bonta said the lawsuit would continue despite the Trump administration rescinding the federal spending freeze directive.
“This directive is unprecedented in scope and would be devastating if implemented. Already, it has created chaos and confusion among our residents,” Bonta said in a statement.
